WASHINGTON — Freddie Mac and the Mae sisters, Fannie and Sallie, may be gaining a new relative, a fellow bent on easing the credit crisis in rural America.
Nicknamed Farmer Mac, he will appear in legislation to be introduced today by California Rep. Richard H. Lehman (D-Sanger) and Rep. Doug Bereuter (R-Neb.).
The bill would establish a secondary market for loans on agricultural real estate and other farm-related loans. Commercial agricultural lenders, such as banks and insurance companies, could sell their agricultural loans to a new secondary market entity, the Farm Mortgage Marketing Corp., also known as Farmer Mac.
The loans would then be resold to institutional investors such as pension funds and insurance companies.
Similar to Fannie Mae
The legislation is similar in concept to existing secondary market institutions such as Freddie Mac (Federal Home Loan Mortgage Corp.), Fannie Mae (Federal National Mortgage Assn.) and Sallie Mae (Student Loan Marketing Assn.).